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"Spain is currently benefiting from the perception among investors that its problems are less severe than Italy's"
- Nicholas Spiro, managing director of Spiro Sovereign Strategy
Spain's new conservative government announced Friday 8.9 billion euros ($11.54 billion) in austerity measures in 2012, with the budget shortfall of 8 per cent of gross domestic product, well above a target of 6 per cent.
"We're facing an extraordinary and unexpected situation, forcing us to take extraordinary and unexpected measures," said Deputy Prime Minister Soraya Saenz de Santamaria.
"Spain is currently benefiting from the perception among investors that its problems are less severe than Italy's given its smaller stock of public debt and lower funding requirements," said Nicholas Spiro, managing director of Spiro Sovereign Strategy in London.